Bankruptcy - Personal Services

Bankruptcy Alternatives

If you are experiencing financial difficulties you may be under the mistaken impression that bankruptcy is your only alternative; but that is not true. There are bankruptcy alternatives - formal and informal that you should explore before declaring bankruptcy.

3 Formal Bankruptcy Alternatives:

  1. Credit Counselling
    Credit counselling is in reality debt counselling. Professionals provide assistance with a host of issues related to debt including budgeting, finding debt solutions, working with your creditors and rebuilding credit.
  2. Debt Consolidation
    Debt consolidation is a single loan that allows you to repay your debts to several or all of your creditors at once, leaving you with only one outstanding loan.
  3. Consumer Proposals
    Consumer proposals are formal offers made to your creditors under the Bankruptcy and Insolvency Act (BIA) to modify your payments. e.g. paying a lesser amount each month for a longer period of time and paying a total lesser amount than you owe

5 Informal Bankruptcy Alternatives:

  1. Review and Redo Your Budget
    The goal is debt reduction. Before you can reduce debt you have to have an accurate account of what is earned versus what is spent. You may not have any idea of how much you are spending each month. Sit down, create a realistic budget and stick to it. You can do this either on your own or through credit counselling.
  2. Contact Your Creditors
    You can contact your creditors informally either on your own or through credit counselling. It is possible to lower the rate of interest and/or make lower monthly payments over a longer period of time.
  3. Contact Your Mortgage Lender
    If you are going to have difficulty making your mortgage payments, contact your mortgage lender as soon as possible. Work with them to find a solution.
  4. Sell An Asset
    If you have an asset that you own free and clear, consider selling it and using the money to pay down some debt.
  5. Contact the Federal Government's Repayment Assistance Plan
    This plan is available if you are having difficulty repaying your student loan debt.

Contact Ira Smith Trustee & Receiver Inc. to discuss the best way for you to deal with your debts with the ultimate goal being debt free and Starting Over, Starting now.